Balancing Pressures by Fabio Franchino and Camilla Mariotto, two veterans of European integration studies, offers a comprehensive and methodologically robust examination of how political actors shape EU economic governance. Covering the period from the Maastricht Treaty to 2019, the book provides a theoretically grounded and empirically rich account of the evolution of key policy instruments, ranging from country-specific recommendations (CSRs) within the European Semester to the excessive deficit procedure (EDP).
The authors’ central argument posits that EU policymakers are constantly navigating a balance among three distinct sources of pressure: economic (asymmetric shocks, fiscal conditions, and uncertainty), national (including electoral cycles, partisan orientation, and public attitudes towards the EU), and supranational (such as eurozone membership, compliance records, and bargaining power in the Council). The study adopts an original analytical framework that applies the policy cycle to EU economic governance, from problem definition to compliance and oversight, and employs models derived from liberal intergovernmentalism, neofunctionalism, and postfunctionalism to explain institutional design and reform dynamics. These frameworks are moreover enriched with theories of compliance and political economy models of fiscal behaviour.
Part I of the book (Chapter 2) provides the ideational foundation for the policy cycle’s analysis. Franchino and Mariotto challenge the notion that EU fiscal governance was shaped by austerity ideology or ordoliberal dogma. Instead, they show that standard macroeconomic reasoning about externalities in a monetary union influenced the fiscal rules embedded in the Maastricht Treaty and the Stability and Growth Pact (SGP). The authors also highlight how economic uncertainty and forecasting errors complicate this technocratic rationale, setting the stage for the political contestation that follows.
The following Part II (Chapters 3–5) focuses on the negotiation and design of economic governance. The authors analyse how member states form preferences, what shapes bargaining outcomes, and why reforms occur when they do. A particular strength is the systematic comparison of bargaining models. Chapter 4 shows that outcomes are influenced not only by preference centrality, salience, and the cost of failure, but also by procedural factors such as sequencing and institutional roles. Chapter 5 explains the timing and direction of major reforms, including the SGP’s various iterations and the post-crisis six- and two-pack, arguing, for example, that persistent noncompliance and uncertainty have led governments to resist deeper delegation to the Commission.
Economic governance implementation is examined in Part III. Chapter 6 peruses the genesis of CSRs. Contrary to the assumption that the Council passively endorses Commission proposals, the authors show that amendments are common and that recommendations are often strengthened, especially when the target country has a poor compliance record. Chapters 7 and 8 turn to the member states’ compliance with CSRs and the EDP. While satisfactory implementation of CSRs is rare, Franchino and Mariotto show that governments tend to implement reforms when economic conditions deteriorate and when CSRs are underpinned by stronger oversight mechanisms. Conversely, such benefit-of-crisis effects are dampened by upcoming elections. Chapter 8 employs panel data from 1994 to 2019 to show that opening an EDP is driven by a mix of economics (debt and deficit levels) and politics (the preferences of pivotal Council ministers and the stance of the Commissioner for Economic and Financial Affairs). Once triggered, the procedure has a measurable effect: governments under supervision reduce their deficits more rapidly, especially inside the eurozone.
The final chapter brings together findings across three normative dimensions: effectiveness (does the policy deliver macroeconomic stability and economic growth?), fairness (are member states treated equitably?), and responsiveness (does the system reflect public preferences?). In all three, the record is mixed. While the long-term trends in fiscal sustainability, current account balance, and EU-wide growth appear reassuring, they mask growing cross-country differences, most notably within the euro area. Similarly, bargaining outcomes diverge from the Rawlsian ideal: larger countries or those with stronger positions in the Council benefit from more favourable treatment, but the overall effects are small. Responsiveness, although improved over time, is still limited by institutional constraints and the policy design biased towards fiscal conservatism.
This review will set aside criticisms of the book (e.g., methodological solutions differ in my own work), but rather discuss future avenues for research. When, during a presentation in Padova, I asked Fabio whether a 2.0 version of the study was forthcoming, he gave me a terrified look… and justifiably so, given the potentially monumental task ahead. Yet what is even more ‘terrifying’ is that two additional studies might well be warranted.
The original research deals with one specific problem for the eurozone, namely that “decentralized fiscal expansion in a monetary union may give rise to externalities that range from higher interest rates, higher average inflation [to] currency appreciation, trade imbalances, and even default.” Thus, the book focuses on fiscal coordination and not on the broader reasons for asymmetric shocks that have brought Europe to its knees. As Paul Krugman aptly wrote, the Optimal Currency Area literature that emphasizes either cross-border financial flows or cross-country differences in wage bargaining institutions staged a revenge. And here the narrative contrasts with the ideational findings of Franchino and Mariotto's research.
Concentrating on the labour market, there is growing evidence that between the two antithetical solutions of EU-wide institutional coordination and decentralization tout court, the European Central Bank and the European Commission favoured the latter (Cova, Reference Cova2022; Braun et al., Reference Braun, Carlo, Diessner and Düsterhöft2024; Guidi and Guardiancich, Reference Guidi and Guardiancich2025). Furthermore, also in those structural policies that directly impact fiscal consolidation, such as old-age pensions, the Commission's avant-gardist neoliberal credentials were rather impeccable (Guardiancich and Borgognoni, Reference Guardiancich and Borgognoni2025). Hence, the study of fiscal governance should be complemented with those socioeconomic policy areas that have increasingly been subject to supranational oversight.
In addition to widening its scope, future research should incorporate the latest developments in EU economic governance. NextGenerationEU’s newly minted conditionality, which places emphasis on rewards rather than on sanctions (Zeitlin et al., Reference Zeitlin, Bokhorst and Eihmanis2024), has borne fruit in terms of domestic compliance (Guardiancich et al., Reference Guardiancich, Guidi, Borghetto and Quaglia2025). The 2024 reform of the SGP seems to have been influenced by it: the new National Medium-Term Fiscal-Structural Plans can be traded against reform pledges. This novelty testifies to the broader positive takeaway from Franchino and Mariotto’s study: EU institutions, including the Commission, engage in policy learning and the ensuing policy innovations should be evaluated and compared with past solutions.
